The FTC Is Readying a Case Against the Largest U.S. Apartment Landlord. Here’s Why.
The U.S. Federal Trade Commission is reportedly planning to sue Greystar Real Estate Partners, the largest apartment landlord in the U.S., for allegedly charging tenants millions of dollars worth of hidden mandatory fees.
The fees ranged from tens to hundreds of dollars per month per tenant, added on top of rent, according to a Bloomberg report. They were related to services like pest control, trash removal, and tenant background checks.
According to Bloomberg, the FTC is expected to allege that Greystar falsely advertised rental prices without these fees, and only told renters about them after they filled out an inquiry form, paid an application fee, or, in some instances, paid a holding deposit. Greystar could face the lawsuit as soon as this week.
“Greystar has worked hard to lead the industry toward improved fee disclosures and has taken proactive steps over the last several years to promote greater fee transparency,” the company said in a statement to the Wall Street Journal. “The most effective path to achieving uniform and consistent fee disclosures across the industry is through clear regulatory guidelines which do not yet exist in the rental space.”
If filed, this lawsuit wouldn’t be the first federal action against Greystar. Earlier this month, the U.S. Department of Justice expanded its August lawsuit against real estate software company RealPage to include Greystar and five other major landlords.
The lawsuit alleges that the landlords shared confidential information with RealPage to align and artificially inflate rents for millions of tenants.
Related: The DOJ Expands Its Lawsuit Against AI Software Company RealPage to Include 6 Major Landlords
According to the 115-page complaint, RealPage collected detailed information about rent prices and lease terms from landlords who would otherwise be competitors. The software company then inputted the information into its AI-based algorithm, which churned out recommendations for the landlords about how to price rentals.
“We are disappointed that the DOJ added us and other operators to their lawsuit against RealPage,” Greystar wrote in a statement last week. “Greystar has and will conduct its business with the utmost integrity. At no time did Greystar engage in any anti-competitive practices.”
Greystar’s website states that it has over 700,000 rental units and $23.5 billion in equity under management in the U.S.
Related: Is One Company to Blame for Soaring Rental Prices in the U.S.?
